Posts Tagged ‘Health insurance exchange’

As the Patient Protection and Affordable Care Act (ACA) celebrates its second birthday, the Obama administration reminded senior citizens – one of the most reliable voter blocs — exactly how much healthcare reform has helped them. Coverage of the “donut hole” in prescription drug plans saved five million seniors and disabled people $3.2 billion. According to data from the Centers for Medicare and Medicaid Services (CMS), through the first two months of 2012, roughly 103,000 Americans saved $93 million in the donut hole. “Without the healthcare law, more than 5.1 million seniors would have faced $3.2 billion in higher drug costs,” Health and Human Services Secretary Kathleen Sebelius said. The donut hole is a gap in coverage for prescription drugs under what is called Medicare Part D. Part D covers 75 percent of the cost of prescription drugs until total medication spending for the patient hits $2,800. Then the hole opens, and seniors must pay out of pocket until they have spent $4,550. After that, Medicare pays about 95 percent of drug costs.

The ACA sent all seniors who hit the prescription drug donut hole a one-time $250 check. In 2011 and 2012, seniors in the donut hole receive a 50 percent discount on brand-name drugs. Additionally seniors covered by traditional Medicare received wellness check-ups and screenings for diseases like cancer and diabetes without paying anything out of pocket. Under the law, the donut hole phases out in 2020.

The seniors’ lobby AARP launched its largest-ever outreach effort with ads and town-hall meetings aimed at defending Medicare and Social Security. “We’re not leaving it up to chance” that the public hears about the law’s benefits, congressional Seniors Task Force co-chairwoman Jan Schakowsky (D-Ill.) said. Democrats, Schakowsky said, have made it a “primary organization effort”…”to tell the truth (about the law) over the next several months.”

Writing in The Hill, Julian Pecquet says that “Democrats see the Ryan budget, which is expected to propose replacing Medicare with subsidies for people to buy insurance, as political gold ahead of the November election. Republicans for their part will spend the week hammering the law’s ‘broken promises’ — higher premiums, employers dropping coverage and the soaring cost of insurance subsidies when compared to the earlier budget window Democrats highlighted when they were debating the law two years ago. They’re also arguing that the healthcare law hastens Medicare’s insolvency by removing $500 billion from the program to pay for what they call an unsustainable new entitlements.”

In terms of implementing the law to meet the 2014 deadline, the ACA leaves it up to the states to set up health insurance exchanges. In states that refuse to do that, HHS has the authority to create a federal exchange as a backup — but it could be stretched thin if it has to cover too many states. At the moment, a number of states are not making plans and the federal exchange could end up covering as many as 15 to 25 states.

Other states are biding their time depending on the outcome of the Supreme Court case — and the elections — to decide what to do next. There’s an excellent possibility that many of them won’t be far enough along by January of 2013, when HHS has to either certify the states’ exchanges or prepare to run a federal exchange in those states. HHS has already extended the deadline for states to apply for the grants that will help them run exchanges. And it’s taking other steps to help states that won’t be ready in time. But if a lot of states refuse to create the exchanges –and more time won’t help them — HHS will be forced to act.

Republican leaders, who once accused the president of focusing too much on healthcare and not enough on jobs, now say the White House is moving away from the ACA because of uncertainty over whether or not its individual mandate is constitutional. In terms of the upcoming Supreme Court oral arguments, Senator Roy Blunt (R-MO) said “I think we’ll win in the end. Now the question is how long is it until the end. There’s no question that the president’s plan will not work.”

A differing opinion was offered by Democratic Caucus Vice-Chairman Xavier Becerra (D-CA). “I think as time goes by more and more people are beginning to support the reform because it starts to apply to them. The more people see what the ACA does, the more they’re going to like it.”

“State legislatures getting in gear to fill their role assigned by the ACA. As I’ve discussed previously, we have a complicated healthcare system which is expensive and inefficient. Instead of simplifying, each state will implement or delay implementing the law based solely on their political interest. This is not productive.”

“The second event is the Supreme Court’s ruling on the legality of the ACA in May. It is possible that the entire law could be struck down, (albeit unlikely). If this scenario plays out, we will have wasted billions implementing parts of the law to date. Another more likely scenario is the law will be upheld but the mandate that everyone purchase health insurance be thrown out. This would severely weaken the law because people will only buy insurance when they are sick. There will still be a requirement that insurance companies have to sell insurance to everyone regardless of health status. This is not financially feasible. Most likely, the law will stand, but who really knows?”

“The third key event is the deadline for states to apply for federal grants to operate their health insurance exchange. State who don’t apply will either have to cede control of the exchanges to the federal government or pay for the cost of implementation themselves. State governors and legislatures against the ACA, like my home state of Florida, risk turning away resources and having more of the federal government running the show. Talk about the law of unintended consequences.”

“The fourth key date is the election in November. If President Obama wins re-election, implementation will continue. If he loses, the winner will have a difficult time repealing the law unless the Republicans can win 60 seats in the Senate. So what is their plan? Have everyone drag their feet on implementation or do a half-baked job. Wouldn’t it be nice if instead they came up with a good plan to fix the parts that are not working? Simplify and clean up the mess of the insurance part of the law and implement with speed and clarity the good parts like preventive care initiatives, rebuilding our primary care workforce, and improving our ability to handle large disasters.”

A similar viewpoint was expressed by Department of Health and Human Services (HHS) Secretary Kathleen Sebelius, who said that access to healthcare is the next civil rights frontier. According to Sebelius, “On Martin Luther King Day, it is easy to congratulate ourselves on our progress in moving beyond segregated schools, lunch counters and drinking fountains. The hard question is this: what injustices do we still accept that should, in fact, be intolerable? Surely Dr. King would find the next civil rights frontier in healthcare, with nearly 50 million uninsured, almost 45,000 deaths annually due to lack of insurance, and more than half of all personal bankruptcies linked to illness and medical bills.”

“While the Affordable Care Act will bring improvements, such as decreasing the ranks of the uninsured, supporting community health centers, and investing in prevention, it leaves many gaps. At least 23 million people will still be uninsured in 2019. Tens of millions will be underinsured, one serious illness away from financial ruin. Most people who suffer medical bankruptcy had private insurance before getting sick. And medical bankruptcy is a cruel double whammy. Already beset with pain, anxiety and fear – due to serious illness – families find themselves financially devastated. This doesn’t happen in other industrialized countries, which have high-quality health systems that cover everyone.”

As a department, we are committed to ensuring that all Americans achieve health equity by eliminating disparities and doing what we can to improve the health of all groups, including the poor and underserved,” Sebelius said. “One of the most important ways we are doing this is through our new health care law, the Affordable Care Act.”

Although individuals and small businesses won’t be able to use an exchange until January 2014, Minnesota has a deadline to get planning underway. States must show they can operate an exchange by early 2013. The federal government will operate the exchange in those states that fail to establish a viable model. Some of the Minnesota prototypes are similar to online travel sites such as Expedia or Travelocity where consumers comparison shop. The difference is that instead of comparing airfares and flight times, users compare the cost and coverage of different health plans. The sites don’t allow the user to obtain specific information, such as the out-of-pocket costs for a knee replacement. Some sites allow the user to compare plans based on a person’s age, gender and health habits, such as smoking.

According to Minnesota Exchange Director April Todd-Malmlov, the state wants feedback. “We’ll have a questionnaire tool that’s on there that will ask people what did you most like about this prototype, what could be improved about that prototype, and then give us a sense of who they are, who’s responding, Are they a consumer, are they a provider, are they an insurer, so we can look at the responses and see how different groups think of the component pieces.”

Insurer Ceridian’s prototype website has an interactive simulation of shopping on its exchange, said Vice President Manny Munson-Regala. “What you’ll have a chance to do is be in the role of a small employer, an employee. You’ll get a sense of what the enrollment process will feel like, how you set up payments and confirm.” Minnesota’s approach to building an exchange is unique, according to Munson-Regala. Instead of asking companies to build exchanges from the ground up, Minnesota asked insurers to demonstrate particular components, such as the small employer or private individual access points.

Similar to filling out health insurance forms, additional information is needed to buy a policy. Some of the prototypes require information about the individual or business before the user can even compare plans. Public review of the prototypes is a great idea, said Geoff Bartsh of Medica, who said it’s important to assess whether consumers find the prototypes helpful or not. The true heavy lifting will be making the prototypes work. “I think the true test of them is going to be how they will actually make those functions happen within the state agencies, between state agencies, and federal agencies,” Bartsh said.

Writing in the Washington Post, Sarah Kliff says that “When Democrats decided to call the new insurance marketplaces created by the health reform law ‘exchanges,’ they didn’t exactly do themselves a favor. The idea of a health insurance ‘exchange’ has never really caught on; it doesn’t conjure up anything specific in the minds of Americans. Because of that, some health reform advocates have recommended forgoing the term altogether, instead calling the exchanges ‘marketplaces.’”

“The public gets a ‘marketplace’,” according to the Herdon Alliance, a pro-health reform strategy firm. “They remain confused by an ‘exchange.’” The standard definition of a health insurance exchange is a state-run website where individuals can buy coverage, although that probably means very little to many Americans. The best way to understand the concept of a health insurance exchange is to see what one actually looks like.

Despite the prototypes’ test drive, Minnesota has not yet decided if the exchange will choose the health insurance plans that ultimately are offered, or if it will be open to all plans that meet certain requirements.

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